Greencore has seen its share price fall by over 9% after recording an operating loss of £13.4m in the first half of its financial year, driven by its £1.5bn acquisition of Bakkavor in January.

In the six months to 27 March, the UK foods manufacturer recorded a 3.2% rise in its pro forma revenue growth, driven by the positive impact of volume and mix of 0.8%, as well as inflation recovery and price of 2.4%.

The group said that while the market was subdued in the first half of its financial year, its volume performance was “robust”, adding that it has continued to win new business.

However, its profit before tax dropped from £26.7m in H1 2025 to a loss of £33.3m, as a result of the Bakkavor acquisition, as well as the amortisation of customer relationship intangibles and higher interest costs arising from the drawdown of the acquisition financing facilities.

CEO at Greencore, Dalton Philips, said: "We are proud to announce strong half year results for the new Greencore, having acquired Bakkavor in mid-January. The combined business is in a great place, and I remain incredibly excited for Greencore's future.

“The business continued to grow profitably during the half, with 15% pro forma adjusted operating profit growth and 3.2% pro forma revenue growth in the UK - during what was a busy period with the Bakkavor acquisition and integration. This performance is testament to the focus and dedication of every one of our 28,000 colleagues who create great food, day-in-day-out.

“The integration of Bakkavor is progressing well and to plan - and we are focused on bringing our 4,000-plus product portfolio and enhanced capabilities to our customers. We are firmly on track to deliver our target of annual cost synergies of at least £80m within three years post-acquisition.”

In its outlook, Greencore said that its Q3 trading has remained robust, and while it continues to monitor the events in the Middle East and inflationary impacts, it remains “resilient and confident” in its near-term mitigations.

The food manufacturer therefore expects to deliver an adjusted operating profit in line with current market expectations, which averages at £232m and ranging from between £227m and £241m.

Investment director at AJ Bell, Russ Mould, stated that the first set of results since the merger has provided "some hints that the tie-up could end up being a winning combination".

However, he concluded: "The significant costs associated with the deal have scarred these results, leading to a first-half loss, and organic growth in Greencore’s legacy business was marginal at best.

"Management flagged a subdued market environment and while the decision to exit the US and concentrate on the UK may be the right one in the long term, there is clearly concern Greencore might have to sell the operations across the Atlantic on the cheap to get a deal over the line.

"On a brighter note, the Bakkavor integration is proceeding as planned and some of the group’s key categories like sandwiches, sushi and pizza are outperforming the wider grocery market. Margins also ticked higher, to suggest management are running a relatively tight ship."

---